Buffett: Billionaire Warns That U.S. Trade Gap Undermines Dollar

Forbes ^ | 20JAN05 | Greg Levine

[FITZ]

Not the reason but the two situations are both occuring. The trade deficit is growing fast AND the dollar is losing it's value. But we can just make more dollars as we like they say. Imagine the wild inflation if dollars weren't being taken out of our economy at the rate they are.

[familyop]

"...but the Fed Rate has been extremely low for years, and it hasn't helped a bit."

You have a good point. Here's a little example (something I have studied more) about why.

I love my daughter-in-law, because she's my daughter-in-law.

But she received her bachelor's in business administration. She sought those high paying jobs the University told her about, and she did look in major cities. Even with placement help, she was told by all that the market for such graduates in accounting jobs is saturated. She's cheap, whether she likes it or not.

Did she seek other graduates to get a new charter and make a go at it? No. Of course not. Men, almost exclusively, have it in them to invent things and start new businesses. I don't fault her for that.

So she nearly has her masters degree in business administration now, and still, she has no desire to compete. She's also a radical, angry Democrat voter by way of our corporate funded social leftism in the universities. She's everything that our powers-that-be want in employees--non-competitive and cheap. I do hope very much, though, that she does one thing that most like her do not do. I hope that she stays with her marriage.

[Zon]

I follow three of the four major currency pairs on forex. The consensus
of analysts in the UK and the US is that the dollar has yet to find the
bottom and expect further declines through at least the first half of the
year. Since Warren Buffett has chimed in perhaps that marks the point
where everybody has the news that the dollar will go lower. Usually when
everyone in a market or coming to a market has the news is when a market
turns, having exhausted it's run.

[SierraWasp]

Frankly, I prefer religious bears to secular ones, myself. They're the ones that are so scary, everybody gets religion all at once!!!

[nicollo]

re. J&J billions repatriation

They are repatriating money but it doesn't mean they are creating new jobs. Another special interest giveaway? Nah.

Oh, come on. If job creation was the purpose they wouldn't have done it. They did it for the profits. Period.

The irony of your post is that these corporations are bringing money back to the US from places that demand that money go to workers, which only encourages less employment.

[endthematrix]

"His cash swelled to $43 billion in the third quarter, by one account, because he couldn't find many investment opportunities. "

Too darn bad!

[Chgogal]

You would think with the weak dollar, Poor Warren could find some investment opportunities in Europe????

Seems to me he's talking out of both sides of his mouth. Growing economy with trade deficit bad, stagnant economy with trade surplus bad. Poor thing, what is a billionaire to do?

[Americalover]

LOL. I know my that bear is sending me to church these days, which means he couldn't be secular, my mistake.

[Chgogal]

My thoughts exactly. What game is Warren playing? He's sitting on $43 billion cash with no game plan? I find that so hard to believe. And why would he make such statements? I don't get it.

Regarding all your comments on Iran, I must say we do live in interesting times. BTW great posts and comments.

[Zhangliqun]

But what the trade/gap deficit really means is that capital (and with it jobs) is flowing out of the U.S. Now you may call that meaningless but no sane person would. FALSE: The trade deficit is consistently matched dollar for dollar by foreign investment into this country. It's pointless to talk ONLY about what is "flowing out" if you don't also examine what's flowing IN. We have had trade deficits pretty much every year for the past 30 years. Our economy has had its ups and minor downs during that time but nothing serious, and the trade deficit has had no significant effect one way or the other. If the trade deficit was such a scary thing, we would be in a second Great Depression by now. We're not. Germany has had a horrible economy for the past 30 years. They are running a trade surplus right now. Plus, poor developing countries usually run a trade surplus. Again, meaningless.

[SierraWasp]

Buffett! The bone-headed billionaire buffoon that offered Schwarzenrenegger the advice that Cauleeforneeuns need to repeal Prop 13 because we don't pay enough property taxes!!!

Even the neophyte newbie celebrity Grabinnator had enough sense to see through the bizzarre billionaire buffoonery!!!

[Dog Gone]

Left wing billionaires are wise sages to be quoted in the media, while conservative billionaires are merely the source of evil funds for right wing wackos.

[SierraWasp]

By George! I think you've swerved into the kernal of truth!!! Trouble is, they're not very altruistic and won't share funds with us other right wing wackos, or we could really swamp them left wing whackos! (they're worse than us, cause they gots an extra "h" in their descriptor)(plus they like Sweedish stuff to a fault)

[oceanview]

take a look at how much Buffett made on Gilette today before youcast him off as a buffoon.

[SierraWasp]

Well... Even a hog roots up a berry if they keep rootin long enuf!!!

[lewislynn]

plus they like Sweedish stuff to a fault

What's with you and Swedes? Do you have a blonde phobia

[SierraWasp]

No! I'm blond, myself! It's that they're Liberal, Leftist Socialists, barely one step away from Communists, or as I prefer to dub them... Commonists!!!

[Grampa Dave]

BuffetBrain was also against GW and Congress lowering the taxes on dividends, which encourage smart companies to go back to declaring dividends. Which has been great for those of who invested in companies/funds were dividends are important again.

[SierraWasp]

Yes, and dividends are probably better for everybody than leveraged buyouts, junk bonds, etc., that once got better tax treatment than dividends used to, due to double taxation inspired by Liberal Dumbocrats in the past!!!

Dubya has been a breath of fresh air in many economic ways, no doubt about it!!! I'm havin a ball helpin employers set up those Health Savings Accounts!!! Talk about yer "win/win" situations for everyone involved!!!

[hubbubhubbub]

So far it hasn't come back in, hence the deficit. When it finally does come back in all that inflation we've been exporting will to China will bite us bad.